Monday, December 06, 2004

Posner Only Took Econ. 1

The much hyped Becker-Posner blog has its first real posts today (here and here). The topic is preventive war. See this marvelous skewering by Kieran Healy.

The issue is that Posner wants to begin to talk about a cost benefit analysis of preventive war:
But what if the danger of attack is remote rather than imminent? Should imminence be an absolute condition of going to war, and preventive war thus be deemed always and everywhere wrong? Analytically, the answer is no. A rational decision to go to war should be based on a comparison of the costs and benefits (in the largest sense of these terms) to the nation...It is relevant in two respects. First, future costs may not have the same weight in our decisions as present costs...Second...if the threat of attack lies in the future it is difficult to gauge either its actual likelihood or its probable magnitude. But this is not a compelling argument against preventive war. What is true is that a defensive war is by definition waged only when the probability of an attack has become one; the attack has occurred. The probability of attack is always less than one if the putative victim wages a preventive war, because the attacker might have changed his mind before attacking.
In the abstract this is uncontroversial. As Henry put it, what can this tell us but that a country should do the thing with the highest expected value (which Posner does later in the post with a numerical example). But Posner's second point brings home the problem with a simple utilitarian framework: how? What do these costs mean and how do you calculate them? He offers no insight into this, which is what a meaningful analysis would have to do. As a commentator at Crooked Timber put it: “Posner learned economics from reading intro text books. He should have read some more.” A meaningful analysis would grapple with question of more advanced economic theory: uncertainty and information (and if I knew more econ. probably even more questions). First, what level of risk is a country willing to bear in terms of the possibility that it is right? You can certainly construct numerical examples where expected value of preventive war is higher than nothing, but the possibility of turning up nothing is 80 or 90 percent. Ought we to go to war then? Second, information. How do the information asymmetries between a country at risk of preventive war and one at risk of waging one work out? The case of Iraq shows that the answer is not necessarily intuitive: we would typically think that Iraq would have done quite a lot to give the U.S. full information on its lack of weapons. But it did not. Why is this and how do you account for it in your analysis?

We have a normative injunction against preventive war for good reason: these are not trivial questions. It is very difficult to grapple with them and come to a clean answer. Therefore a good heuristic is simply not to do it: the risks and uncertainties are too high. Posner, by not even grappling with these complications, says absolutely nothing useful (except to raise the initial question, which is thought provoking). Like many a simple-minded conservative, the reliance solely on econ. 1 leads to rather foolish policy. Why don't they at least take intermediate theory?

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